The “main evil” for the future competitor of oil is named

The head of Sibur Dmitry Konov: the main evil for the petrochemical industry is volatile prices voiced the “main evil” for the petrochemical industry, which Deputy Prime Minister Alexander Novak previously called a possible future competitor of oil in terms of consumption.

According to Konov, the main problem of the petrochemical industry is the increased volatility (variability) of product prices. “The main evil – and this is true both for us and for the consumer – is not some absolute level of prices, but the speed and frequency of their changes. When prices rise and fall by 30 percent month on month, it is bad, “the top manager said.

He also spoke about the numerous disruptions in the global production and supply system this year. These include interruptions in the production of American companies due to the Uri storm, an accident at a Gazprom plant in Novy Urengoy, and increased demand for gas in Europe due to low storage capacity.

“As a result long-standing established system fails. This manifests itself in the hypervolatility of product prices, leading to anomalous shipping costs from one geography to another. All world trade in this sense has been undermined, “concluded Konov, adding that in the near future he expects prices for his company's raw materials (primarily liquefied petroleum gas) and the cost of finished products to rise by tens of percent.

In October, Deputy Prime Minister Alexander Novak called petrochemistry a future competitor to the oil industry in terms of product consumption. According to him, a change of leader may occur in 2030, when oil consumption will recover to the level of 2019, and consumption of polypropylene and polyethylene will grow by 4 and 3.7 percent compared to the current level, respectively.



Leave a Reply